Travel, Logistics & Infrastructure Practice

Destination zero: An
action plan for shipping
CEOs
The transition to zero carbon can be a value-generating opportunity
for shipping companies—if they are proactive and purposeful, rather
than reactive and defensive.
This article is a collaborative effort by Susann Almasi, Martin Joerss, Arjen Kersing, Matt Stone,
Benjamin Weber, and Apostolos Zampelas, representing views from McKinsey’s Travel, Logistics &
Infrastructure Practice.

© MR1805/Getty Images

December 2022
 Decarbonization has risen rapidly up the agenda Existing Ship Index (EEXI), EU Emissions Trading
of shipping CEOs. The shipping industry—one System (EU ETS), and potentially IMO-mandated
of the most costly and challenging sectors to carbon pricing. They anticipate a “green fuels”
decarbonize—faces growing calls by shareholders, shortage in coming years and want to lock in supply
regulators, customers, and other stakeholders to now, turning this into a significant competitive
decarbonize at a pace commensurate to the needs advantage. They look over the horizon and aim to
of a warming planet. The EU, International Maritime avoid stranded-asset risk in the coming decades.
Organization (IMO), and individual countries are These companies are following the maxim of the
tightening carbon regulations, while customers great ice hockey player Wayne Gretzky, “I skate to
and clients want decarbonized shipping to meet where the puck is going to be, not where it is.”
their own Scope 3 decarbonization targets.1 The
Both postures are built on fiercely held beliefs
same goes for lenders trying to decarbonize their
about the future, and there are no simple answers
lending portfolios,2 and environmental groups and
to the questions surrounding decarbonization. It
civil-society organizations are campaigning for
is no exaggeration to say that how one chooses
decarbonization more vigorously than ever.
to decarbonize—at what pace, with which
On top of this, as shipping CEOs work to steer their technologies, and to what degree of integration
organizations through a multidecade transition to with the company’s asset strategy and commercial
net zero, they are simultaneously having to juggle posture—is one of the biggest strategic choices
near-term market disruptions, geopolitical tensions, facing shipping CEOs right now.
crewing challenges, and burgeoning digitalization.
What would be imprudent is not to have a plan at
What is a shipping CEO to do? all, and not to stress-test that plan against a range
of scenarios. Given the significant uncertainties
On the one hand, inaction is a default choice.
around future costs of technologies and fuels,
Some shipping companies have taken a posture
policy, customer demand, the financing landscape,
of “strategic patience.” Choosing from a sea
and other factors, CEOs need clarity on what
of emerging sustainability technologies and
decarbonization moves are “good for all seasons”
alternative fuels can feel more like a gamble than
and which ones should be made only under certain
a savvy investment. A wrong choice could have
conditions. The plan needs to be robust and
ramifications lasting as long as a ship’s life span,
practical at the level of each individual vessel (for
which is often more than two decades. Currently,
example, which retrofits to do at the next dry dock
the production and bunkering infrastructure for
and which propulsion and fuel pathway to choose
alternative fuels does not exist at any meaningful
for each new build) while also satisfying a portfolio-
scale. Moving too early may saddle the business
level decarbonization pathway and financial-return
with an uncompetitive cost structure. The regulatory
profile (see sidebar “What a decarbonization action
environment remains murky and uncertain. In this
plan looks like”).
context, “wait and see” seems more prudent.
This article presents three levers that decision
On the other hand, “green leaders” have chosen to
makers can activate to accelerate the industry’s
act purposefully to try to cut through the uncertainty.
transition toward zero carbon and capture value
They seek to capture the emerging “green premium”
in the process (see sidebar “A decarbonization
for decarbonized shipping services from customers
action plan checklist”). Each lever—fleet, fuel, and
and get ahead of the coming regulations such as the
commercialization—represents a critical aspect that
Carbon Intensity Indicator (CII), Energy Efficiency
shipping companies could address now. As we’ll

1
For example, the Cargo Owners for Zero Emissions Vessels (coZEV) initiative orchestrated by the Aspen Institute has 19 cargo owners,
including Amazon, Ikea, and Unilever, which are demanding zero-carbon container shipping by 2040—well ahead of IMO targets and those of
many shipping companies.
2
For example, 30 banks representing approximately two-thirds of global ship financing have signed up to the Poseidon Principles, which aim
to reduce the total annual greenhouse-gas emissions in shipping by at least 50 percent by 2050.

2 Destination zero: An action plan for shipping CEOs

What a decarbonization action plan looks like

For companies embarking on a generalizations about future fuels (“We model and optimization algorithms to
decarbonization transformation, an will move our entire fleet to ammonia”). rapidly identify the specific actions
action plan helps to incorporate both In our experience, the cost-optimal across fleet and fuel that will meet a given
bottom-up and top-down tactical actions decarbonization pathway is more nuanced decarbonization objective.
at the level of each individual vessel, than either approach.
Given the level of uncertainty, actions vary
which, in aggregate, meet a fleetwide
In collaboration with the Mærsk McKinney by scenario. Even within a single scenario,
target trajectory for decarbonization and
Møller Center for Zero Carbon Shipping, a shipping fleet may adopt multiple fuel
optimize for cost and capital expenses.
for which McKinsey acts as a knowledge pathways. And each vessel will have its
Some companies approach this purely
partner, we’ve created the Fleet own unique adoption of energy-saving
at the level of individual vessels (“What
Decarbonization Optimizer tool. The tool devices, based on the specific operating
efficiency technologies are net-present-
harnesses the proprietary bottom-up characteristics, age, and starting efficiency
value-positive and should we install
cost modeling of the Center’s NavigaTE of a vessel (Exhibits A and B).
them?”); others make overly sweeping

Web 2022
ShippingIndustryCarbonZero
Exhibit A
Exhibit 1 of 4

Use of LNG, biodiesel, e-ammonia, and bio-/e-methanol differs substantially

depending on assumptions about the future.

Illustrative projected fuel consumption by scenario, and characteristics of scenarios

Delayed transition Current momentum Accelerated transition Heavy fuel oil (HFO),
marine gas oil (MGO)
70
60 Biodiesel
50 Liquefied natural gas
(LNG)
40
30 E-methane (PS)
20 Ammonia (green and blue)¹
10 E-methanol (PS)
0 Bio-methanol
21 30 40 50 21 30 40 50 21 30 40 50

Commonalities and
HFO-powered vessels until 2050 differences between
scenarios
Biodiesel major
Limited use of biodiesel
transition fuel

LNG (including bio- and e-LNG) plays a meaningful role

Alternative fuels² not

Alternative fuels² introduced from ~2030
introduced until ~2040

Bio-/e-methanol scaled in 2030s

1
Ammonia (blue) is only in the current scenario for the year 2040.
²Alternative fuels include ammonia (green and blue) and e-methane liquid (PS).

McKinsey & Company

Destination zero: An action plan for shipping CEOs 3

 What a decarbonization action plan looks like (continued)

Web 2022
ShippingIndustryCarbonZero
Exhibit B
Exhibit 2 of 4

Various efficiency technologies are adopted (or not adopted) depending on

total-cost-of-ownership economics.

Projected ship count per year by energy efficiency lever¹

Main engine levers

Fuel-efficient Hull Propeller Propeller Rudder Trim and draft Weather
paint cleaning cleaning improvement autopilot optimization routing
devices
15
10
5
1
21 25 30 21 25 30 21 25 30 21 25 30 21 25 30 21 25 30 21 25 30

Propeller Flettner Air Bulbous bow Engine Hull shape Kites

retrofit rotors lubrication retrofit derating optimization
15
10
5
1
21 25 30 21 25 30 21 25 30 21 25 30 21 25 30 21 25 30 21 25 30

Auxiliary engine levers

Load Variable Lighting Shore Waste heat
optimization frequency drive systems power recovery system
15
10
5
1
21 25 30 21 25 30 21 25 30 21 25 30 21 25 30

¹Includes levers where there is no adoption.

McKinsey & Company

explain, these levers share deep interdependencies Fleet: Making ships more sustainable
that, when pulled, can activate the much-needed As ship owners and operators look at their fleet for
velocity to reach the industry’s sustainability goals. opportunities to boost decarbonization, they could
We’ll show how creating a decarbonization action consider three actions: hardware efficiency, analytics-
plan across all three levers can be a methodical driven sailing optimization, and slow steaming. A
approach to achieving just that. McKinsey study conducted in 2020 found that
around 70 percent of the world’s tankers and

4 Destination zero: An action plan for shipping CEOs

A decarbonization action plan checklist

A decarbonization action plan is an Fuel: Commercialization:

indicative, comprehensive decarbonization
— Where can we find alternative fuel, and — What are our customers targeting in
trajectory to provide orientation for fleet
how much will be available—by when their Scope 3 emissions?
planning, fuel sourcing, and commercial-
and at what cost?
ization over the next ten years and longer. — What green shipping services can we
Here’s a checklist of questions for compa- — What mix of fuel pathways best offer to meet our customers’ needs?
nies to answer as they plan. balance decarbonization, cost,
— What is the right price point for our
Fleet: resilience, and other considerations?
green shipping services?
— What agreements should we strike to
— Which energy-savings devices and — What enablers are required to unlock
secure supply at an attractive price?
other efficiency measures should “green demand” (for example, carbon
we adopt? — How can we best manage a portfolio of accounting and transparency)?
diverse suppliers?
— Should we retrofit our existing vessels
for new fuels? — How can our fleet deployment/
network change to adopt new fuels?
— What propulsion and fuel configuration
should our new builds adopt?

container fleets would fail in 2018 to meet the 2028 and interior, including boilers, auxiliary-demand
CII requirements. The IMO introduced these carbon- reductions, and auxiliary-supply efficiencies. As an
intensity indicators as part of a data-collection system example, a leading container line that made over
to track and reduce vessel emissions. 400 modifications to more than 150 vessels in its
fleet was able to reduce its fuel consumption by
However, as the CII trajectory beyond 2027 hasn’t
8 percent. The benefits were so encouraging that
been formally agreed on and enforcement of the
the company has started next-level conversations
regulations isn’t clear, some ship owners and
with their suppliers and yard partners.
operators may be putting off the necessary efficiency
upgrades. While this may defer short-term costs, When new ships need to be added to existing fleets,
these companies are also forfeiting the cost savings ship owners and operators could adopt a design-
generated. Typically, onboard adjustments have very to-value (DTV) approach and improve existing
short payback periods of less than two years, so the procurement processes. DTV optimizes the vessel’s
earlier they are made the greater the returns. lifetime value by removing unnecessary features
(which may include shaft generators) and adding
Hardware improvements are the most
enhancements that make a clear positive business
straightforward way to boost efficiency. These
and environmental impact, such as energy-monitoring
include technical modifications that are both
devices and premium paints. It also ensures that
exterior—propeller improvement devices, bulbous
the size and specs of the main and auxiliary engines
bows, and high-performance paints, for example—

Destination zero: An action plan for shipping CEOs 5

 Reducing speeds by a knot could reduce
fuel consumption by between 10 and
15 percent, which could be a meaningful
strategy for older container ships.

are appropriate for the vessel’s function. This would without biofuels for an extra three to five years and
reduce cost while fulfilling the specifications that meet target CII scores. However, slow steaming may
are directly relevant to the operator.3 be less relevant for bulk carriers, which are already
moving at very slow speeds.
Analytics-driven sailing optimization is an
increasingly important lever for decarbonizing Sometimes contracts with customers will need
in the short term. A number of variables need to be rewritten to enable slow steaming: in the
to be managed to achieve optimal fuel burn and pure car carrier (PCC) segment, automotive OEMs
carbon emissions, including weather and currents, historically demand fast sailing for inventory
port berth availability, fuel price forecasts at management reasons but now have the opportunity
upcoming ports, and customer needs; optimization to reduce their Scope 3 supply chain emissions by
algorithms are increasingly up to this task. The allowing their shipping partners to sail more slowly.
question here is one of “build versus buy”: Does
Moreover, if maintaining transport capacity is a
a company gain a competitive advantage in
top priority, ship owners and operators should also
developing its own algorithms or benefit from
be aware that more vessels may be required to
the wider data pool addressed by off-the-shelf
compensate for the low speeds. This may potentially
solutions? For example, a leading cruise line built
result in higher shipping costs. In such cases, slow
its own voyage-optimization algorithms in-house,
steaming may not be a feasible strategy. There’s no
and then realized the value it held for others and
straightforward, “always right” answer to whether
sold the solution to a major shipping supplier.
companies should deploy this strategy.
Meanwhile, digital “natives” such as ZeroNorth and
NAPA are proliferating, with solutions that learn
Fuel: Designing a diversified
from ever-growing datasets.
supplier portfolio
Lastly, slow steaming may be another way for The type of fuel used by ships has a direct
ships to lower their carbon impact by sailing at impact on the industry’s carbon footprint. There
significantly slower speeds, which reduces fuel are numerous classes of clean (or cleaner) energy
consumption. Reducing speeds by a knot could sources, including biofuels and electrofuels
reduce fuel consumption by between 10 and that are at different stages of maturity (see
15 percent. This could be a meaningful strategy for sidebar “The challenging choice of future fuels”).
older container ships, which can remain in operation

3
Buyers can also implement a rigorous procurement process to bring down the purchase price of new ships. For instance, procurement
decision makers can follow technical normalization to compare offers like for like, analyze their product’s cost structure to optimize design,
expand their supplier portfolio, and conduct transparent multiround negotiations that encourage competitive bids. A container line that
implemented such an approach managed to save $15 million in capital expenses and $5 million in operational expenses for one vessel.

6 Destination zero: An action plan for shipping CEOs

The challenging choice of future fuels

There are a number of alternative fuels in — Biodiesel (HVO). A “drop in” fuel DAC, it is generally considered carbon
focus for the shipping industry. Our work that burns in existing internal- neutral on a life cycle basis.
in shipping, across segments, indicates combustion engines (ICEs), biodiesel
— E-ammonia. Derived from green
there is no one-size-fits-all answer, and can provide up to 50 to 90 percent
hydrogen and nitrogen pulled from the
we expect to see many, if not all, of these decarbonization (depending on the
atmosphere, e-ammonia is a truly zero-
options adopted over the next 30 years: feedstock and production process),
carbon fuel and has the most attractive
faces potential bio-feedstock
— Liquefied natural gas (LNG). An costs of any of the “e-fuels” (plus an
constraints (which are also in demand
alternative fuel in shipping for decades, attractive cost-down trajectory as
for fuels in other sectors like aviation),
LNG reduces CO2 emissions on a the costs of green hydrogen come
and has limited cost-down potential
“tank to wake” basis by approximately down). However, ammonia is toxic, so
(because the production processes
20 percent. However, methane-slip leaks and safety are a major concern,
are relatively mature).
issues onboard the vessel and during and an ammonia engine won’t be on
production (“well to wake”) are factors — Bio-methanol. Derived from bio- the market for another two to three
that can increase LNG’s emissions, feedstocks, bio-methanol can be a years. Ammonia needs to be stored
potentially beyond the levels carbon-neutral fuel (on a life cycle in refrigerated tanks which take away
associated with traditional fuel oil. basis). There are marine engines some cargo capacity. Combusting it
today that can burn methanol, and can create nitrous oxide (N2O), which is
— Bio-methane/bio-LNG. Derived from
it is liquid at room temperature, so a very potent greenhouse gas that can
bio-feedstocks and leveraging existing
it can be easily handled and stored be addressed with scrubbers.
LNG infrastructure (for example,
(helping to counteract the cargo
storage, bunkering, and ships), it can — Green/blue hydrogen. Given its
capacity loss from its volumetric
be used to displace fossil LNG but can disadvantaged volumetric energy
energy density, which is lower than
also face methane-slip issues and has density, pure hydrogen—either
fuel oil). However, it has a limited
an unpromising cost-down potential compressed or liquefied—will
cost-down potential due to relatively
because the production processes are probably only find a market in short-
mature production processes.
relatively mature. sea segments such as tugs, ferries,
— E-methanol. Derived from green offshore supply vessels, and potentially
— E-methane. Derived from green
hydrogen and captured CO2, cruise ships, possibly through the
hydrogen and captured CO2 and
e-methanol is more expensive than use of fuel cells (which have yet to be
leveraging existing LNG infrastructure,
bio-methanol today but will become stress-tested in a marine environment).
e-methane is more expensive than
cheaper in the long run. It will always
either e-methanol or e-ammonia but — Nuclear. The closest thing to zero-
be more expensive than e-ammonia,
may also face methane-slip issues carbon shipping on the water today
as the latter is manufactured from
during the combustion process, (in navies and the Russian ice-
nitrogen, which is abundantly available
especially in medium-speed four- breaking fleet), nuclear still has to
in the air, but it has an attractive
stroke engines. CO2 is still emitted overcome environmental, regulatory,
cost-down trajectory (as the costs of
during combustion, but if sourced economic, and societal acceptance
green hydrogen come down). CO2 is
from biogenic CO2 or direct air capture issues for it to be adopted at scale in
still emitted during combustion, but if
(DAC), it is generally considered commercial shipping.
sourced from captured biogenic CO2 or
“carbon neutral” on a life cycle basis.

Destination zero: An action plan for shipping CEOs 7

 Shipping companies can actively plan for a companies will need to invest in and partner with
diversified sourcing funnel to support their energy providers without guaranteed success. To
future clean-fuel needs. Decision makers could spread the risk, speed and diversification are key:
move from seeing fuel procurement as purely shipping companies will need to be prudent to
commodity purchasing to actively managing ensure that they have a wide array of alternative-
a multisource, multiproduct, and multipartner fuel suppliers and lock in supplies while they can.
supply landscape.
Executives can make efforts to ensure that their
Designing a supplier portfolio of different clean supplier portfolio is balanced across six dimensions:
and traditional fuels is the most effective way technology readiness, CO2 abatement cost,
of managing this added complexity. In the past, potential to build partnerships, regional distribution,
shipping companies would rely on one or just a few first-mover foothold, and supplier maturity
providers able to supply the fuel needed across (Exhibit 1).
their fleets in major ports. Price was the determining
Right now, most companies still source their
factor; companies were mostly concerned about
energy needs from a handful of mostly fossil-fuel
optimizing price by betting or hedging long-term
suppliers. Diversifying supplier portfolios with
contracts against spot purchases.
more clean-fuel providers opens up more options.
Making the transition to alternative fuels, however, While alternative fuels may lag behind in maturity,
requires a different tack. Many suppliers operate technology readiness, and cost, suppliers tend to
locally and lack the vast supply networks of legacy be more willing to partner with their customers to
providers. They also don’t have long-established pilot new innovations. This could open the way for
track records and need strong supportive partners shipping customers to seize a first-mover foothold
(for instance, offtake agreements to make their and secure supply or even better fuel prices than
projects “bankable”). This means that shipping their competitors over the longer term. Clean

Web 2022
ShippingIndustryCarbonZero
Exhibit 1
Exhibit 3 of 4

Shipping companies may need to seek new features in fuel suppliers.

Illustrative example of how a supplier portfolio may take into account new buying factors
Technology readiness CO₂ abatement prices Favorability of
dimension
Favorable
Current approach Neutral
Unfavorable

Supplier maturity Potential to build partnerships

Possible future approach

First-mover foothold Regional distribution

McKinsey & Company

8 Destination zero: An action plan for shipping CEOs

 fuels can be manufactured in many more areas An attendant green premium, depending on its
globally compared with mature carbon-based fuels, level, could also make such green offerings value-
improving availability. Finally, as costs come down, accretive. Yet, while more than 85 percent of
clean fuels can, in time, offer CO2 abatement costs shippers say that sustainability will significantly
that are lower than paying any future carbon taxes. affect their choice of logistics partners in the next
five years, their preferred choice of green products
Making the transition toward a more diversified
and their willingness to pay differ.4
supplier portfolio may require shipping companies
to acquire several new capabilities. First, they need Shipping companies, therefore, can consider how
more transparency on the supply and demand of to tap into their understanding of their customers to
sustainable fuels. Trackers that monitor global develop and offer relevant sustainable services at
data—including announced commitments, published an appropriate price. To do this they can break down
sourcing deals, and new production projects— their customer base into strategic segments. The
may need to be built (or bought) so shipping starting point is to examine their customers’ Scope
companies are constantly up to date with the latest 3 decarbonization targets, and then to understand
developments. Shipping companies could also set the marginal abatement cost curves (MACCs) of
up a “technology radar” to keep abreast of the most their customers’ Scope 3 emissions: How important
recent cutting-edge innovations that affect the is shipping to their decarbonization ambitions,
supply or usage of sustainable fuels, including by at what cost relative to other sources of Scope
collaborating on research projects with universities 3 emissions, and in what time frame? Analysis of
and partnering with VC accelerator networks to these segments could then inform the creation
screen potential solutions in the start-up space. of differentiated green offerings that address
customer-specific decarbonization needs.
Shipping companies may also need to train up their
optimization and sourcing muscles. For procurement The portfolio of green offerings could comprise a
decisions, a data-driven cost model is useful for number of features, which are dependent on the
calculating the appropriate cost the company should shipping company’s existing fleet and fuel choices.
be paying for each fuel type, based on feedstock There are three main categories: direct reduction
sources, production pathways, scale advantages, fuel (when goods are physically shipped on dedicated
hedging, and supplier margins. Live data for tracking lower-carbon vessels); physical decoupling
demand and supply should also factor into the (whereby a customer pays for fuels that improve a
calculations. Meanwhile, a logistics calculator—which fleet’s carbon footprint, even if their goods are not
takes into account the specific costs of blending and moved onboard the vessels in which those fuels
distribution at the production site, as well as the costs are consumed, underpinned by “book and claim”
of bunkering and uplifting at the fueling location— certificates); and carbon-neutral voyages (when
could help to optimize the cost of transporting the carbon offsets are used that support sustainability
fuel from source to tank. projects but are not directly linked to the transport
value chain). Other features could include forward
Commercialization: How companies sourcing for future cost reductions—for example, by
can make a green margin making advanced market commitments for green
The third decarbonization lever is about making shipping services.
the economics of sustainable shipping work. As Shipping companies may be able to promote
customers look to decarbonize their Scope 3 supply the uptake of sustainable shipping modes by
chain emissions, they will increasingly differentiate positioning greener shipping as a value generator
among shipping partners based on their emissions. for shippers (Exhibit 2). Not only may shippers be

4
McKinsey Voice of Shipper Survey, based on results from 1,933 respondents in Canada, Germany, and the United States, April–May 2022.

Destination zero: An action plan for shipping CEOs 9

 Web 2022
ShippingIndustryCarbonZero
Exhibit 2
Exhibit 4 of 4

Green products offer substantial value creation potential if not priced as

cost-plus.

Illustrative value-pricing waterfall for product¹

Base cost
Based on nongreen product cost
Shipper’s avoided fees
Potential carbon taxes and compliance-trading schemes avoided
Shipper’s price premium
Higher prices/margins for greener product achieved
Shipper’s market share gain
New, sustainability-focused end-customer groups attracted

Projected green product value

Cost to break even Green

for green product margin

¹Values would be in percent uplift (indexed).

McKinsey & Company

able to avoid potential carbon taxes, but they may decisions over at least the next decade—serves as a
also attract new, sustainability-focused customers. critical tool for shipping companies in this respect.
If shippers market and price their green products
The decarbonization action plan consists of three
astutely, they may not only be able recoup the
main components: ambition setting and baselining,
increased costs of decarbonized shipping but
action planning, and execution and learning.
should also be able to enjoy a green margin.
Emerging product-level carbon accounting and — Ambition setting and baselining. The company
labeling will be important enablers in this respect. defines its decarbonization trajectory, deciding
whether it will meet the minimal regulatory
Creating a decarbonization action plan compliance requirements or pursue more
The three areas set out in this article do not operate ambitious targets. The baseline of each vessel’s
independently from one another and so require a emission performance is taken, and calculations
systematic approach to spark a virtuous cycle in are made to determine the emissions thresholds
which positive outcomes are mutually reinforcing. to reach the target. Different combinations of
For example, companies need to ensure that they the fleet, fuel, and commercialization tasks
can secure a sufficient amount of sustainable are modeled and evaluated based on cost,
fuel to deliver the green products they’re offering complexity, and risks.
to their clients. A decarbonization action plan—
— Action planning. An integrated set of actions
an indicative, comprehensive decarbonization
across fleet, fuels, and commercialization is then
trajectory that provides orientation for fleet
defined to meet the decarbonization ambition.
planning, fuel sourcing, and commercialization

10 Destination zero: An action plan for shipping CEOs

 Find more content like this on the On fleet, hardware upgrades are planned for — Execution and learning. As the tasks are
McKinsey Insights App upcoming drydocks; new builds are planned to executed, the company will learn more
adopt expected clean fuels; analytics solutions about how the market is developing, how
are adopted; and contracts are reviewed and stakeholders’ needs are evolving, and what
amended to enable slow steaming (where works and doesn’t work. It’s important that the
relevant). On fuels, clean-fuel needs are company has a central “single source of truth”
compared with expected supply developments; for their decarbonization initiatives—usually a
partnerships with producers and bunkering decarbonization transformation office or nerve
providers are formed; and network strategies for center—so the company can rapidly adopt
Scan • Download • Personalize vessels consuming clean fuels are updated. On learnings across the business.
commercialization, customers’ Scope 3 targets
and MACCs are analyzed and green products
are defined and A/B tested. Customers, regulators, shareholders, and other
stakeholders are stepping up the pressure for
Crucially, action planning needs to be tested
shipping companies to decarbonize at a much
against a range of scenarios, underlying
faster pace. Opportunities abound for companies
the inherent uncertainty in expected future
that take decisive action now. By making smart
technology and fuel costs, policies and
fleet upgrades, savvy fuel-supplier choices, and
regulation, and customers’ demands for green
commercially beneficial arrangements, shipping
shipping. It needs to be clear which actions are
companies should not only be able to offset the risks
considered no-regret moves across all scenarios
involved and propel the industry toward greater
and what the company should do only under
sustainability, they could very likely also reap
certain scenarios.
significant returns in the process.

Susann Almasi is an associate partner in McKinsey’s Charlotte office, Martin Joerss is a senior partner in the Hamburg office,
Arjen Kersing is a senior expert in the Amsterdam office, Matt Stone is a partner in the London office, Benjamin Weber is an
associate partner in the Stuttgart office, and Apostolos Zampelas is an associate partner in the Athens office.

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Destination zero: An action plan for shipping CEOs 11